US Factories Light Up After COVID... Manufacturing Jobs Increase by 67,000

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The New York Times (NYT) reported on the 26th (local time) that manufacturing jobs in the United States have significantly revived since the COVID-19 pandemic. As U.S. manufacturers experienced increased domestic product demand and supply chain issues during the pandemic, reshoring?bringing production facilities back to the home country?occurred one after another, leading to job growth.

According to the report, although 1.36 million workers were laid off from U.S. manufacturers between February and April 2020 following the outbreak of COVID-19, 1.43 million people were rehired by manufacturers up to last month. This represents a net increase of 67,000 manufacturing jobs since the pandemic began.

The NYT stated, "Generally, factories have laid off more workers than other employers during recessions over the past half-century, and job growth during recoveries has been slower. This time was different. Since June 2020, under both the Donald Trump and Joe Biden administrations, factories have expanded manufacturing jobs by more than 30,000 per month."

This phenomenon is interpreted as a result of global production networks being disrupted after the COVID-19 pandemic, prompting U.S. manufacturers to start domestic production. Initially, U.S. manufacturers established production facilities abroad where labor and production costs were cheaper, but after experiencing the pandemic, costs surged, causing difficulties. Additionally, the U.S. government’s support measures to revive domestic manufacturing led to reshoring, which in turn contributed to job growth.

It is also understood that increased domestic product demand in the U.S. played a role. The U.S. government injected an astronomical amount of cash to mitigate the economic impact of COVID-19, and consumers used this to purchase automobiles, furniture, and other goods, forcing manufacturers to expand jobs to increase supply. In particular, jobs in the U.S. furniture, textile, and computer parts industries have recently recovered to pre-COVID-19 levels.

China’s "Zero COVID" policy is also analyzed as a background factor that led manufacturers to reduce dependence on China and increase jobs within the U.S. Professor Mary Lovely of Syracuse University said that companies witnessing China’s response to COVID-19 likely sought alternatives, stating, "Companies have started to move."